Tuesday, 28 February 2017

Digital Identity - what could it mean for consumers?

In our latest blog post Amanda Long,
Director General at Consumers International, discusses the topic of digital
identity and the potential benefits and threats for consumers.

The idea of people having an easy way to
prove their identity online through a digital identity is not new, but has so
far been used mainly by governments enabling citizens’ access to public
services. Austrian citizens can use an approved app on their smart phone, or a smart card to apply
for benefits, do tax returns or access healthcare.

A digital identity is a means by which
individuals can prove their identity online - for example, job applicants
needing to prove their residency status, or even qualifications. It links up to an identity checking system
which can verify that the person with that identity is who they say they are –
both online and in person. This means people can use their digital identity
credentials to access services or products without having to physically present
valuable documents, such as passports, birth certificates, driving licenses or
a handful of utility bills.

Digital identity could represent a
comprehensive solution to many millions of people who are effectively barred
from entry to many things that could improve their quality of life. Without
traditional forms of documentation, transactions like renting accommodation,
setting up a bank account or getting a mobile phone contract become impossible.

It could also solve problems for
consumers in more developed markets, wherever identity is a problem. According
to a start-up digital identity provider: “Age
verification online would prevent underage users from opening inappropriate
social media accounts, and ensure that minors cannot access adult content. It
would also help online retailed to confirm that someone is eligible to buy age
restricted goods like DVDs, computer games, alcohol, cigarettes and knives”
(YOTI)

Digital identity could potentially deliver
financial inclusion, seen as a strong route out of poverty - or at the very
least accelerates us towards it. The World Bank has a programme dedicated to
identity and financial inclusion, ID4D – which “helps countries analyse problems, design
solutions, and implement new systems to increase the number of people with
official identification and the development impact of the overall
identification system.”

Of
course for some people, the scope that any kind of centralised identity system
has for government surveillance and discrimination will be cautious about the
implications of digital identity systems. With
this large caveat in mind, what is there that we learn from the pioneering
steps governments have taken in exploring digital identity that might be useful
for budding consumer applications? The UK digital identity verification
programme has developed a set of Consumer and Privacy principles to guide practice.

These types of frameworks will be
important as the implications of this technology could be significant. If it is
not designed with protection in mind and regulated accordingly:

-Individuals’ privacy could be at risk, with the potential for personal
data for all parts of your digital existence being held by digital ID
verification services, as a means to authenticate who you are, with you having
little or no control of what’s collected and stored or how it is being used to
make decisions about you. If alternative
income streams to monetising consumers’ personal data aren’t identified then
the risks to privacy will continue.

-There is a threat of lack of consumer choice. It is very possible that
a critical mass could form of people using a particular digital identity service that means it is effectively
forced onto everyone. This could mean
less competition between digital ID verification providers and also a weakening
of consumers’ rights to protection. In this scenario, the speed at which a
particular service is adopted by a mass of people may mean that the opportunity
to check, challenge and reform terms and conditions of the service are reduced.
An individual who is swept up with this, who sees it as the only way to
continue access to a product, may agree to terms and conditions that if given
more time or choice they would not.

-We might also see a situation where one person would need multiple
digital identities, in order to access a variety of services as companies may
not recognise the same identity providers.

-The liability model for digital identity is also complex. For example,
should digital identity providers be responsible for actions done based on the
authentication they give?

With so much potential for consumer
benefit and significant threats at play, consumer organisations must build up
their expertise on this issue so they can influence the private sector as it
develops digital identity systems. Consumer organisations are in a strong
position to draw upon existing public sector practice, and the need for trust,
confidence and consumer protection in digital systems to influence this nascent
industry for the better.